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Glossary

Premium

The premium is the price paid for insurance coverage, billed monthly, quarterly, or annually. In a guest damage program the guest's per-reservation fee plays the economic role of the premium for the damage layer.

By Andrew Bate, Co-founderReviewed by Stuart BateUpdated

Why this matters for property managers

Per-night damage insurance products bill the manager a premium on every stay. A waiver program reverses the flow: the guest pays the fee, the manager keeps it, and insurance premium is paid only for the layer above the retention. That is the structural reason program economics beat per-night pricing for portfolios of ten or more homes.

Related terms

Damage waiver fee
The damage waiver fee is the per-reservation amount a guest pays for a damage waiver. In professionally managed vacation rentals it usually runs $69–$99 for lower-ADR properties and $99–$199 for higher-ADR properties, charged at booking on every channel.
Deductible
A deductible is the amount the policyholder pays out of pocket on a claim before insurance pays. A $1,000 deductible on a $5,000 claim means the insured pays $1,000 and the insurer $4,000. Higher deductibles generally mean lower premiums.
Loss ratio
The loss ratio is the share of premium an insurer pays out in claims. A 60% loss ratio means $0.60 in claims for every $1.00 of premium collected.
Surplus lines
Surplus lines insurance is coverage placed with carriers not licensed in the insured's state but approved to write risks the standard, admitted market will not. Many short-term rental products are written on surplus lines because admitted carriers have not caught up with the category.

Browse every term in the insurance glossary for property managers.

Premium: common questions

How much does Velaris charge?

A flat $9 per reservation for program administration, plus the actual damage retained below the manager's retention. Insurance above the retention is priced per program.

Is the guest damage fee a premium?

Legally no — it is a contractual fee, not insurance premium — which is why waiver programs are structured and documented differently from insurance sales.

Related guides

Program pricing
Read the full Velaris guide.
Vacation rental damage waiver program
Read the full Velaris guide.

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